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Power-One Inc. Message Board

  • paul_g_power paul_g_power Nov 22, 2010 11:11 AM Flag

    Shorts - what's the worst that can happen

    Take a look at Netflix NFLX and this is what can happen when you get short on the wrong stock. This is unbelievable, people shorting from $100 - 160 and the stock is now trading at $190 - the short percentage of float is 32%. The PWER shorts are not into something as risky ok but it's reasonably likely that the stock could be taken out if it trades at such a low PE. What do you think?

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    • >>The PWER shorts are not into something as risky ok...<<

      I'm not so sure about that. After all, NFLX is trading at around 50x next year's consensus earnings estimate. Meanwhile, PWER is trading at around 7x next year's consensus estimate, with those earnings projected to be 27% higher than this year's number. If it starts to look more certain that this company will make its number and if it were then to trade at a forward PEG ratio of just 1, it would be $34/share, lol.

      (That is NOT a prediction; I'm merely pointing out the upside risk to the shorts here.)